A significant housing affordability package advanced towards legislative approval on Wednesday, having garnered bipartisan support in the House of Representatives. The measure is a revised iteration of the 21st Century ROAD to Housing Act, which successfully passed through the Senate in March. The bill, which secured a significant endorsement with a vote tally of 396-13, seeks to address the housing crisis through a multifaceted approach: increasing loans for housing construction, encouraging local governments to relax permitting regulations, promoting manufactured housing, and limiting Wall Street’s acquisition of single-family homes. Together, the proposals from the House and Senate indicate that Washington is addressing America’s housing affordability crisis with heightened urgency. If enacted, the measures would represent one of the most comprehensive federal housing initiatives in decades. However, although the two bills have overarching objectives in common, they differ significantly in crucial aspects. Most notably, the House version adopts a more lenient stance regarding the limitations placed on institutional investors purchasing single-family homes compared to the Senate proposal. The two governing bodies must reconcile their differences prior to the law reaching President Donald Trump’s desk.
Leaders of the Senate Banking Committee, Senators Tim Scott and Elizabeth Warren, are set to engage in discussions regarding the House bill with their Republican and Democratic counterparts to gather insights on the proposed changes, according to a Senate aide’s statement on Wednesday. Earlier this month, Trump articulated his endorsement of the Senate’s bill through a social media post, asserting that the measure “would ensure that homes are for people, not corporations.” This represents the second iteration of the House bill aimed at progress this year. An earlier draft did not impose restrictions on large institutional investors purchasing single-family homes. However, the proposal put forth by the Senate, following an executive order from Trump, seeks to prohibit investors and companies from acquiring single-family homes if they already possess 350 or more. It would additionally focus on the rapidly expanding “build-to-rent” sector by mandating that developers divest those properties within a seven-year timeframe. Critics cautioned that the measure could significantly impede the development of new rental properties.
The House measure that passed on Wednesday maintains the Senate’s more extensive restrictions on institutional investors acquiring single-family homes, while removing the obligation for investors to sell build-to-rent and renovate-to-rent properties. Instead, House lawmakers chose a more moderate approach: establishing a hotline for tenants residing in properties owned by significant institutional investors. The bill’s passage received commendation in a joint statement from 11 national housing organizations, including the National Association of Home Builders and the Mortgage Bankers Association. “The revised Act, akin to all compromise legislation, is not without its flaws. “Nevertheless, it is one that our organizations support as it encompasses some of the most significant housing proposals in a generation,” the statement said. “As the process moves forward, it will be vital that the final language safeguards millions of BTR homes and the individuals and families that are building their lives in them,” the statement said. The bill seeks to enhance the housing supply by facilitating streamlined environmental reviews, providing grants for local housing planning, and promoting conversions from office spaces to residential units. Similar to the Senate’s bill, this House version would facilitate the expansion of the supply of manufactured homes, which are constructed in factories rather than on-site and are generally quicker and more cost-effective to produce.
Under federal law established in 1974, manufactured homes are required to be constructed on a permanent chassis, a wheeled base that facilitates transportation, akin to conventional mobile homes. In practice, however, the majority of manufactured homes remain stationary once they arrive at their designated location. The necessity of incorporating wheels incurs supplementary expenses and may restrict the locations where these residences can be situated, frequently relegating them to mobile home parks in accordance with local zoning regulations. Both bills eliminate that rule, which could reduce the cost of each manufactured home by $5,000 to $10,000, as stated by the Bipartisan Policy Center. Manufactured homes have traditionally been classified as personal property; however, the proposed legislation seeks to facilitate access to conventional mortgage loans for manufactured home owners.